Todd D. Bramson, CFP

 You probably should switch your 5 percent contribution to the Roth component. As a resident, you are in the 15 percent tax bracket. When you finish your training, your income and tax bracket should grow substantially. Assuming that trend continues, and at retirement you remain in a higher tax bracket than you are in now, you achieve the tax leverage desired. 

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How to figure out whether it's better to invest in Roth 403(b) or standard 403(b)

 The age-old answer here: it depends. The way we "keep score" in the investment world is your net worth: assets minus liabilities. You can increase your net worth two ways: build up assets or pay down liabilities. The key is to make your money work hardest for you. If you have a 4 percent student loan debt but believe an investment out there over the long haul can earn you more than 4 percent on average, then it would be smarter to pay the minimum towards your 4 percent debt and put any extra money towards that investment. If, however, you have private loans at 12 percent, then it usually would be in your best interest to pay off these loans as quickly as possible.  			

Situations and goals vary greatly among individuals, so make sure you're developing a solid financial strategy that includes a debt reduction strategy that works for you. 

Answers to our readers' questions were provided by Todd Bramson, CFP, ChFC, CLU, a financial adviser with CRI Securities LLC and Securian Financial Services Inc., which offer securities and investment advisory services and are members of FINRA/SIPC. CRI Securities LLC is affiliated with Securian Financial Services Inc. and North Star Resource Group. North Star Resource Group is not affiliated with Securian Financial Services Inc. and is independently owned and operated. The answers provided are general in nature and are not intended to be specific recommendations. Please consult a financial professional for specific advice in relation to your individual circumstances. TR: 149480 / DOFU: 2/2010

Learn whether to pay off medical student debt before investing in retirement plans

 Regardless of the status of your loans, you always are entitled to make payments on the loans. Most borrowers choose not to make payments during periods of deferment, although it is allowed. The federal government pays the interest on subsidized federal loans during periods of deferment. The borrower always is responsible for the interest on unsubsidized loans. 

Learn whether it's possible to make payments on federal loans

 Good news! You may not have damaged your credit at all, depending on how late the payments were made. Although your credit card or auto finance company may have charged you a late fee, the credit-reporting agencies consider a payment late on the 31st day after the payment was due. Let's say your auto loan was due on the 15th of the month. If your payment was made in the next 30 days, then your credit score should not have been affected. 

Author | Todd D. Bramson, CFP

Articles

How to figure out whether it's better to invest in Roth 403(b) or standard 403(b)

Learn whether to pay off medical student debt before investing in retirement plans

Learn whether it's possible to make payments on federal loans

Determine how much you've damaged your credit with late payments